An immediate cash injection of £180m in new Treasury money was yesterday announced to fund the home secretary's drive against rising street crime and cope with the record prison population.

A further £100m supplement from the cross-government criminal justice reserve fund will enable Mr Blunkett to promise more frontline police officers in addition to the 130,000 he has promised to put in place by March next year. Extra civilian support staff are also to be employed.

The extra Treasury funds for the Home Office are on the same scale as those given to education, reflecting the higher political priority that the government now attaches to tackling crime.

Police figures published yesterday showed street robberies in London rose by an alarming 38% in the last year. Further "substantial" funds to tackle street crime will be allocated from existing resources.

The new money will bring immediate relief to Mr Blunkett in his attempts to tackle the explosion in street crime, the domestic demands of the fight against terrorism and the crisis in prison numbers.

But some of the more difficult, longer term funding decisions on how major structural reforms in the courts, criminal sentencing and the asylum system will not be settled until the negotiations for the June comprehensive spending review are complete.

The extra cash now will pay for 2,300 new places in prisons and in local authority secure accommodation. It will ensure that Mr Blunkett's announcement earlier this week that young persistent offenders will be remanded while they await trial is fully funded.

The package is also thought to involve about 2,000 new prison places to help cope with the record 70,200 jail population. It is believed that the prison service had pressed for a further 3,000 extra places in prefabricated units.

Although the Home Office believes numbers have now stabilised, they are only just a few hundred below the official "bust point" in England and Wales. Work will start next month on a network of new "quick build" 40-bed units within established prisons.

Penal reform groups were dismayed at the plans to build thousands of additional prison places, arguing that England and Wales was already the prison capital of the EU.

The new street crime funds will be used to pay overtime for extra patrols, for new equipment and the introduction of video identity parades.

"The extra funding will ensure the police are not faced with a choice between fighting terrorism or fighting street crime," said Mr Blunkett. "It also means that when the courts decide that criminals need to be locked away we have appropriate accommodation capacity to provide the security, treatment and rehabilitation needed."